Lobster Trap
A strategy used by a target firm to prevent a hostile takeover. In a lobster trap, the company passes a provision preventing anyone with more than 10% ownership from converting convertible securities into voting stock.

Investopedia Says:
Examples of convertible securities include convertible bonds, convertible preferred stock, and warrants.

Related Terms:
Busted Takeover
Enterprise Value
Hostile Takeover
Management Buyout (MBO)
Merger
Poison Pill
Sandbag
Saturday Night Special
Shark Repellent
Sleeping Beauty
Voting Shares
Whitemail

• Carrying Cost Of Inventory
• Carrying Value
• Cartel
• Carve-out (Equity Carve-Out)
• Cash
• Cash Account
• Cash Accounting
• Cash Advance
• Cash-And-Carry Trade
• Cash And Cash Equivalents (CCE)
• Cash And Cash Equivalents (CCE)
• Cash Available For Debt Service (CADS)
• Cash Available For Debt Service (CADS)
• Cash Balance Pension Plan
• Cash-Based Option
• Cash Basis
• Cash Budget
• Cash Charge
• Cash Commodity
• Cash Conversion Cycle (CCC)
• Cash Conversion Cycle (CCC)
• Cash Cost
• Cash Cow
• Cash Delivery
• Cash Distribution Per Unit (CDPU)